Nifty crashes 900 points; Blames broker for bad orders

Last updated on: October 05, 2012 16:27 IST

The National Stock Exchange index Nifty crashed 900 points on Friday morning, halting the trade, which the bourse blamed on erroneous orders worth Rs 650 crore (Rs 6.5 billion) by a broker Emkay Global for one of its clients.

The NSE said it is investigating the matter and the abnormal orders that resulted in multiple trades at low prices.

In a statement after the incident, which halted the trade in cash markets for about 15 minutes, NSE said, "The market circuit filter got triggered due to entry of 59 erroneous orders which resulted in multiple trades for an aggregate value of over Rs 650 crore.

"These orders have been entered by a trading member Emkay Global Financial Services on behalf of an institutional client.

"These non-algo market orders have been entered for an erroneous quantity which resulted in executing trades at multiple price points across the entire order book thereby causing the circuit filter to be triggered.

"These orders have been identified to a specific dealer terminal," it added.

On the other hand, BSE said the market at the exchange was working fine and there were no technical or other issues at the bourse.

However, the BSE index Sensex also fell by about 200 points in reaction to the

plunge in Nifty, as there are many common stocks on the two indices.

The incident occurred on a day when expectations were high for a sharp upward rally on the bourses following various reform measures approved by the Union Cabinet on Thursday evening, including on FDI in insurance and pension sectors.